government can increase productivity by promoting education-- investment in human capital (H)

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inward oriented policies

aim to raise living standards by avoiding interaction with other countries

outward-oriented policies

promote integration with the world economy

knowledge as a public good

ideas can be shared freely, increasing the productivity of many

population growth may affect living standards 3 ways

stretching natural resources

diluting the capital stock

promoting tech progress

Suppose that Slovenia undertakes a policy to increase its saving rate. This policy will likely

lead to higher GDP growth for a period of several years

other things equal, relatively poor countries tend to grow

faster than relatively rich countries, called the catch up effect

The dictator of a certain country requires that companies planning to open or expand must pay a large fee to file an application one year prior to building new factories or expanding existing ones. Other things the same, in the long run this requirement would

reduce real GDP per person and productivity

A country witha relatively low level of real GDP per person is considering adopting 2 policies to promote economic growth. The first is to increase barriers to trade. The second is to restrict foreign investment. Which of these policies would promote growth?

neither the first nor the second

Thomas Malthus's predictions turned out to be wrong due to

technological advances such as those during the Industrial Revolution

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